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Data centres could consume 13 percent of Australia's total energy by 2040 as AI boom drives unprecedented demand
A Greenpeace-commissioned report warns that data centres powering artificial intelligence could consume up to 13 percent of Australia's total energy by 2040, up from roughly 2 percent today. The surge in demand could force coal power plants to remain online longer, threatening the country's renewable energy transition.
A new report commissioned by Greenpeace has raised alarm about the staggering energy demands of data centres in Australia, warning that they could consume as much as 13 percent of the country's total energy by 2040. The analysis, based on official data from the market operator, paints a picture of a rapidly growing sector that threatens to overwhelm the electricity grid and derail Australia's transition to renewable energy.
Currently, data centres account for roughly 2 percent of Australia's total energy consumption, but the explosion of generative AI since the launch of ChatGPT in 2022 has dramatically accelerated demand. The highest growth projections show energy consumption by data centres increasing sixfold between the 2024 and 2025 forecasts alone, a pace that caught energy planners off guard and has prompted urgent discussions about grid capacity.
Greenpeace argues that the sudden surge in demand from data centres could have a direct impact on Australia's ability to shut down ageing coal power plants. Even as new renewable energy sources come online, the additional demand from AI computing could force existing fossil fuel plants to keep operating longer than planned simply to meet the increased electricity requirements, effectively delaying the clean energy transition.
The ABC's national AI technology reporter noted that while AI is increasingly powering everyday services such as Google Search, the computing infrastructure required for generative AI uses significantly more electricity than traditional computing. Plans to build more data centres across Australia are already underway, with substantial investment flowing into digital infrastructure from both domestic and international technology companies.
Energy policy experts say the findings should prompt a rethinking of how Australia manages the intersection of its digital ambitions and climate commitments. Some have called for data centre operators to be required to source their electricity entirely from renewable sources, while others argue that market-based solutions will naturally drive investment in clean energy. The report comes at a critical time as Australia seeks to balance economic growth in the technology sector with its obligations to reduce carbon emissions.